Page:United States Statutes at Large Volume 118.djvu/1219

118 STAT. 1189 PUBLIC LAW 108–311—OCT. 4, 2004 prescribe regulations regarding the status of options the values of which are determined directly or indirectly by reference to any index which becomes (or ceases to be) a narrow based security index (as so defined).’’. (b) EFFECTIVE DATE.—The amendments made by subsection (a) shall take effect as if included in section 401 of the Community Renewal Tax Relief Act of 2000. SEC. 406. AMENDMENTS RELATED TO TAXPAYER RELIEF ACT OF 1997. (a) AMENDMENT RELATED TO SECTION 211 OF THE ACT.— Subparagraph (B) of section 529(c)(5) is amended to read as follows: ‘‘(B) TREATMENT OF DESIGNATION OF NEW BENE FICIARY.—The taxes imposed by chapters 12 and 13 shall apply to a transfer by reason of a change in the designated beneficiary under the program (or a rollover to the account of a new beneficiary) unless the new beneficiary is— ‘‘(i) assigned to the same generation as (or a higher generation than) the old beneficiary (determined in accordance with section 2651), and ‘‘(ii) a member of the family of the old beneficiary.’’. (b) AMENDMENT RELATED TO SECTION 213 OF THE ACT.—Clause (iii) of section 530(d)(4)(B) is amended by striking ‘‘account holder’’ and inserting ‘‘designated beneficiary’’. (c) AMENDMENT RELATED TO SECTION 226 OF THE ACT.—Section 1397E is amended by adding at the end the following new sub section: ‘‘(i) S CORPORATIONS.—In the case of a qualified zone academy bond held by an S corporation which is an eligible taxpayer— ‘‘(1) each shareholder shall take into account such share holder’s pro rata share of the credit, and ‘‘(2) no basis adjustments to the stock of the corporation shall be made under section 1367 on account of this section.’’. (d) AMENDMENT RELATED TO SECTION 311 OF THE ACT.— Subparagraph (B) of section 55(b)(3) is amended by striking ‘‘the amount on which a tax is determined under’’ and inserting ‘‘an amount equal to the excess described in’’. (e) AMENDMENTS RELATED TO SECTION 1001 OF THE ACT.— (1) Paragraph (2) of section 1259(c) is amended by striking ‘‘The term ‘constructive sale’ shall not include any contract’’ and inserting ‘‘A taxpayer shall not be treated as having made a constructive sale solely because the taxpayer enters into a contract’’. (2) Subparagraphs (A) and (B)(i) of section 1259(c)(3) are each amended by striking ‘‘be treated as a constructive sale’’ and inserting ‘‘cause a constructive sale’’. (3) Clause (i) of section 1259(c)(3)(A) is amended by striking ‘‘before the end of’’ and inserting ‘‘on or before’’. (4) Clause (ii) of section 1259(c)(3)(B) is amended by striking ‘‘substantially similar’’. (5) Subclause (I) of section 1259(c)(3)(B)(ii) is amended to read as follows: ‘‘(I) which would (but for this subparagraph) cause the requirement of subparagraph (A)(iii) not to be met with respect to the transaction described in clause (i) of this subparagraph,’’. (6) Subclause (II) of such section is amended by inserting ‘‘on or’’ before ‘‘before the 30th day’’. 26 USC 1259. 26 USC 55. 26 USC 1397E. 26 USC 530. Applicability. 26 USC 529. 26 USC 1234B note.